Van Elle LON:VANL the Nottinghamshire-based, AIM-listed engineering contractor announced a new major contract win this morning.
The company will be undertaking a piling project with an energy company in the South East of England. The contract will pay GBP13m and is with a “key customer” in the UK power infrastructure sector, according to a statement released on the London Stock Exchange this morning. The statement declined to outline the name of the client and Van Elle was unavailable for comment.
This follows a similar contract win in the energy sector from May, where Van Elle was awarded a GBP8m ground engineering contract by Acciona in the West Midlands. The West Midlands contract was for piling and foundations work on Enfinium’s Kelvin waste-to-energy facility in Sandwell. The project started in May and ran for 30-weeks.
Waste-to-energy
The Sandwell contract saw Van Elle installing and testing more than 1,000 rotary and continuous flight auger (CFA) piles to help build the new waste to energy facility in West Bromwich. The new waste-to-energy facility is a combined heat and power facility that will reprocess 395,000 tonnes of post-recycled residual waste a year to generate up to 47MW of partially-renewable energy that could power up to 95,000 homes.
The new contract in South East England will start at the end of December and will complete mid-way through 2024. Mark Cutler, Van Elle’s chief executive said: “The energy sector is a particular focus for Van Elle given its long-term growth characteristics and our strong track record. We are very pleased to be announcing a second significant contract award in the sector this year.”
Key to both contract wins, said Cutler, was the performance of Van Elle’s General Piling Division. The company noted that the new contract builds the order book and contributes towards meeting consensus expectations.
Van Elle return to profit
As previously reported Van Elle returned to profit earlier this year with a GBP125m record revenue, the first time that it shown a profit since 2019. With further contract wins in the energy sector, at a time when the nation’s focus is on energy supply, the future looks good for the construction company and is targeting its mid-term financial targets of 5-10% annual revenue growth, 7-8% operating profit margin and 15-20% ROCE.
Founded in 1984, and listed on AIM in late 2016, Van Elle has grown to become one of the UK’s largest and most diverse ground engineering contractors. The company offers a wide range of specialist geotechnical techniques and services to customers in a variety of construction end markets. Van Elle’s end-to-end solutions encompass ground investigation, general and specialist piling, rail engineering services, modular foundations and ground improvement and stabilisation services in a wide range of environments.
The company is focused on three core UK market sectors – residential, infrastructure and construction –offering a full range of integrated ground engineering services on both a regional and national basis. Van Elle’s work in the residential market is focused on building integrated piling and foundation systems for national and regional house builders, retirement and multi-storey residential units, whilst the business also provides specialist ground engineering services to the rail, coastal and energy and utility sectors through its infrastructure department.The company also is supporting ground improvement works at beverage can manufacturer, Crown’s new manufacturing facility. Once complete, the 5,8064m2 facility will become Crown’s largest factory for beverage cans in Europe.
Van Elle opened trading at 39.4p and had risen to 40p in the first two hours of trading. The company has offered a -15.5% year-to-date return with a -10% one-year return. The company’s shares have ranged between 33.5p and 53.9p over a 52-week period giving the company a market cap of GBP41m
